Recently, The value of the dollar in Colombia exceeded the barrier of $4,100 pesos, leading to the Representative Market Rate for the beginning of the third week of June being located at $4,151 COP, evidencing a gain of more than 200 pesos in its valuation during the last few days. During this time, The maximum price reached was $4,215 and the minimum was $4,113.
The rise of the US currency in the country has significant implications for both those who benefit and those who suffer. While exporters, The oil sector and families that receive remittances see profit opportunitiesimporters, domestic travelers and companies with dollar debt face challenges.
Benefited by the rise of the dollar
Colombian exporters are the main beneficiaries of the rise in the dollar. By receiving income in dollars, they see an increase in their income in Colombian pesos, which allows them to obtain greater benefits and competitiveness in the international market. On the other hand, the oil sector also benefits, since oil is priced in dollars. With the US currency rising, oil companies obtain greater income from their sales, which can translate in an improvement in their financial balances and an increase in the government’s oil revenues.
Other major beneficiaries are families that receive remittances from abroad, since when converting the dollars received to Colombian pesosthey get a greater amount of money. This is especially relevant for those who depend on this income for their daily sustenance and those who wait for that help that comes from their relatives who work in countries like the United States.
Hurt by the rise of the dollar
Importers are one of the sectors most affected by the rise of the dollar. By having to pay more pesos for each dollar, import costs increasewhich can be transferred to the final prices of imported products, affecting consumers. Colombian companies that have debt in dollars also feel the negative impact, Since with a more expensive dollar, the cost of your debt increases, which can affect your ability to pay and your finances in general.
Another group of those most affected are Colombians who plan to travel abroad. and visit countries like the United States. A more expensive dollar means that they will need more pesos to buy the same amount of dollars, making their travel costs more expensive and reducing their purchasing power abroad.
Finally, even the Colombian government is affected in a mixed way. On the one hand, the external debt becomes more expensive with a rising dollar, increasing debt service costs, but, on the other hand, its income from oil exports increases, which can partially mitigate the negative effect.
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